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Velorution

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One of London's leading electric & urban cycling retailer is furthering its expansion of dedicated stores

132%
 - 
Funded 21 Jan 2019
£400,014 target
£543,090 from 190 investors
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Business overview

Location London, United Kingdom
Social media
Website www.velorution.com
Sectors Automotive & Transport Mixed Digital/Non-Digital B2C
Company number 03623058
Incorporation date 27 Aug 1998
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Investment summary

Type Equity
Valuation (pre-money) £5.7M
Equity offered 8.56%
Tax relief N/A
  • Idea
  • Team
  • Updates
  • Investors 190
  • Discussion
  • Documents

Idea

Introduction

Velorution is one of London’s leading electric and urban cycling retailers. We aim to bring the most innovative electric and urban cycling products to our customers, the Velorutionaries.

Since our crowdfunding in 2016, we have opened 3 permanent stores and turned over £500k in 2018 from those three stores alone.

Velorution's seasonal concessions and pop-ups in Selfridges and Lululemon drive valuable brand awareness and sales of our urban and electric offering. We plan to expand this program with more exciting brand partners.

Our latest store format, Velorution Electric, has shown strong growth and profitability, as it requires a much smaller retail footprint and delivers a very attractive yield.

The strategy is simple: continue to roll-out the Velorution Electric format stores (with 2 planned for 2019), whilst growing the mixed urban and electric offering through our existing estate and e-commerce channels.

Intended impact

Velorution's goal is to celebrate the wonderful forms of electric and urban cycling, and encourage people to fall in love with riding through cities on beautiful and innovative cycles, designed to the highest specifications and equipped with the most stylish apparel and accessories from around the world.

Over the past 6 years, electric bikes have been a core component of Velorution’s offering.

Expert staff in all of our stores, 7-day-a-week test rides and attractive financing offerings have been key components in switching the daily commute of many Londoners to the e-bike movement.

The growth in this market is set to continue as the UK follows the commuter trends in Europe and, in particular, Germany.

In our view, Velorution is in a prime position to lead and service the growth of the e-bike market and zero-emissions green initiative in the UK over the coming years.

Substantial accomplishments to date

- 2012: the Velorution brand was established and trading began from 88 Great Portland St.

- 2013: Velorution opened its first seasonal concession at Selfridges, which it has continued to date.

- 2014: Velorution opened its flagship store at 75 Great Portland St.

- 2016: Velorution successfully crowdfunded on Seedrs.

- 2017: Velorution Islington opened and a new e-commerce site was put in place.

- 2017: Velorution won the BikeBiz Award for Independent Bike Dealer of the Year.

- 2018: Velorution opened Velorution Hackney and Velorution Electric in Fitzrovia. We also launched our first partnership with lululemon, taking a floor in their Marylebone High St store throughout June 18.

In collaboration with lululemon we organised 19 Velorution events ranging from a Meet the Makers with Tesla and Taschen to a Brompton bicycle ride and a Ladies business chapter meeting. We are now in the 6th edition of our Velorution Magazine which is available to readers online and physically, featuring over 40 interviews with our customers, the Velorutionaries. All of these activities have continued to strengthen our brand and customer awareness.

Monetisation strategy

Management plan to roll-out 2 more Velorution Electric stores in 2019, which would bring the group to 6 permanent sites.

Velorution will continue with its seasonal concession and pop-up program which, along with the Velorution Magazine, to help further brand awareness and sales across the group.

Velorution.com will begin investing more heavily in social media marketing, which has appeared to have made an impact on the performance of the business.

Importantly, we expect that all existing sites in the group (particularly those opened in the last 18 months) - Velorution Great Portland Street, Velorution Islington, Velorution Hackney, and Velorution Electric Marylebone - will continue to mature and be a invaluable part our offering.

We are aiming to have the Group itself moving into profitability, after which new store openings and online growth which we believe will continue to grow in the same manner.

Use of proceeds

Velorution is seeking to raise £400k to continue to fund our growth to date. We have developed a business model which works across multiple channels but recognise that expanding our brick and mortar presence will help us to achieve our ambition of servicing more electric bicycles, further enhancing our brand awareness and ultimately, finding more Velorutionaries. Our focus right now is the London market and ensuring that if you are riding an urban or electric bicycle, that bicycle came from Velorution.

Based on this vision, we want to increase our footfall by sourcing and opening two new hand-picked stores across London. The proceeds therefore from this campaign will be allocated in the following way:

- 2 x New Velorution Electric Stores: 75%
- Inventory & Store Opening Working Capital: 25%

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If you successfully purchase a share lot of this business, you will be granted access.

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If you successfully purchase a share lot of this business, you will be granted access.

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Investing involves risks, including loss of capital, illiquidity, lack of dividends and dilution, and should be done only as part of a diversified portfolio. Please read the Risk Warnings before investing. Investments should only be made by investors who understand these risks. Tax treatment depends on individual circumstances and is subject to change in future.

This webpage has been approved as a financial promotion by Seedrs Limited ("Seedrs"), which is authorised and regulated by the Financial Conduct Authority. It is not intended to be a promotion of any individual investment opportunity and is not an offer to the public. The summary information provided about investment opportunities on this webpage is intended solely to demonstrate the types of investments available on the Seedrs platform, and any investment decision should be made on the basis of the full campaign. Full campaigns are available to investors who have become authorised to invest on the Seedrs platform. All investment activities take place within the United Kingdom, and any person resident outside the United Kingdom should ensure that they are not subject to any local regulations before investing.

Seedrs does not make investment recommendations to you. No communications from Seedrs, through this website or any other medium, should be construed as an investment recommendation. Further, nothing on this website shall be considered an offer to sell, or a solicitation of an offer to buy, any security to any person in any jurisdiction to whom or in which such offer, solicitation or sale is unlawful. Seedrs does not provide legal, financial or tax advice of any kind. If you have any questions with respect to legal, financial or tax matters relevant to your interactions with Seedrs, you should consult a professional adviser.

Tax Relief (SEIS)

This business is eligible for SEIS relief - providing qualifying investors with income tax relief of 50% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Tax Relief (EIS)

This business is eligible for EIS relief - providing qualifying investors with income tax relief of 30% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Valuation (pre-money)

Valuation rounded from £5,663,783

This is the fully-diluted pre-money valuation of the business (i.e. before the new investment comes in and including issued options and other equity interests). In contrast, the post-money valuation is based on inclusion of the new investment in the value.

It is calculated as the pre-money valuation plus the amount of new investment. e.g. If Company A is ascribed a pre-money valuation of £1,200,000 by prospective investors investing £300,000, its post-money valuation is £1,500,000.

Pitch type

There are 5 types of investment pitch available on Seedrs.

  • Equity
  • Convertible
  • Fund
  • Cohort
  • Secondary

Investing in a regular equity campaign is the simplest and most common way to invest in a startup. You decide which business you want to invest in, and if the campaign hits its funding target then you will become one of their shareholders. As the company becomes more valuable, so do your shares; allowing you the opportunity to share in the future success of the business.

Learn more about pitch type on Seedrs

Equity Offered

The equity offered is the percentage of the company’s shares being issued in return for the amount of investment raised.

When the amount raised is less than 100%, the equity offered is based on the target raise. Once the company has raised over 100% it is based on the total raised.

In some scenarios, entrepreneurs may accept additional direct investment after closing their Seedrs campaign. Provided this is within 6 months of the closing and on the same terms, we do not typically offer pre-emption rights on that extra investment (where you have the opportunity to invest again to maintain your percentage shareholding).

Learn more about investing and pre-emption rights.

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None of the information in constitutes part of the campaign and it has not been approved or reviewed by Seedrs.

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